VALID ON (VLID3) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for VALID ON (Brazil)

Based on various researches at Oak Spring University , VALID ON is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, increasing energy prices, wage bills are increasing, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, supply chains are disrupted by pandemic , etc

---

---

---

---

Introduction to SWOT Analysis of VALID ON

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that VALID ON can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the VALID ON, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which VALID ON operates in.

According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.

---

SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of VALID ON can be done for the following purposes –
1. Strategic planning of VALID ON
2. Improving business portfolio management of VALID ON
3. Assessing feasibility of the new initiative in Brazil
4. Making a Printing Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of VALID ON

---

Strengths of VALID ON | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of VALID ON are -

Effective Research and Development (R&D)

– VALID ON has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – VALID ON staying ahead in the Printing Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Ability to lead change in Printing Services

– VALID ON is one of the leading players in the Printing Services industry in Brazil. Over the years it has not only transformed the business landscape in the Printing Services industry in Brazil but also across the existing markets. The ability to lead change has enabled VALID ON in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Sustainable margins compare to other players in Printing Services industry

– VALID ON has clearly differentiated products in the market place. This has enabled VALID ON to fetch slight price premium compare to the competitors in the Printing Services industry. The sustainable margins have also helped VALID ON to invest into research and development (R&D) and innovation.

Organizational Resilience of VALID ON

– The covid-19 pandemic has put organizational resilience at the centre of everthing VALID ON does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Training and development

– VALID ON has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.

Analytics focus

– VALID ON is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Printing Services industry. The technology infrastructure of Brazil is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Diverse revenue streams

– VALID ON is present in almost all the verticals within the Printing Services industry. This has provided VALID ON a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.

Strong track record of project management in the Printing Services industry

– VALID ON is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Cross disciplinary teams

– Horizontal connected teams at the VALID ON are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.

Learning organization

- VALID ON is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at VALID ON is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at VALID ON emphasize – knowledge, initiative, and innovation.

Superior customer experience

– The customer experience strategy of VALID ON in Printing Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Highly skilled collaborators

– VALID ON has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Printing Services industry. Secondly the value chain collaborators of VALID ON have helped the firm to develop new products and bring them quickly to the marketplace.

---

---

Weaknesses of VALID ON | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of VALID ON are -

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, VALID ON is slow explore the new channels of communication. These new channels of communication can help VALID ON to provide better information regarding Printing Services products and services. It can also build an online community to further reach out to potential customers.

High bargaining power of channel partners in Printing Services industry

– because of the regulatory requirements in Brazil, VALID ON is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Printing Services industry.

High dependence on existing supply chain

– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of VALID ON supply chain. Even after few cautionary changes, VALID ON is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left VALID ON vulnerable to further global disruptions in South East Asia.

Products dominated business model

– Even though VALID ON has some of the most successful models in the Printing Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. VALID ON should strive to include more intangible value offerings along with its core products and services.

High cash cycle compare to competitors

VALID ON has a high cash cycle compare to other players in the Printing Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Increasing silos among functional specialists

– The organizational structure of VALID ON is dominated by functional specialists. It is not different from other players in the Printing Services industry, but VALID ON needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help VALID ON to focus more on services in the Printing Services industry rather than just following the product oriented approach.

High operating costs

– Compare to the competitors, VALID ON has high operating costs in the Printing Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract VALID ON lucrative customers.

Skills based hiring in Printing Services industry

– The stress on hiring functional specialists at VALID ON has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.

High dependence on VALID ON ‘s star products

– The top 2 products and services of VALID ON still accounts for major business revenue. This dependence on star products in Printing Services industry has resulted into insufficient focus on developing new products, even though VALID ON has relatively successful track record of launching new products.

Employees’ less understanding of VALID ON strategy

– From the outside it seems that the employees of VALID ON don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

Low market penetration in new markets

– Outside its home market of Brazil, VALID ON needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

---

VALID ON Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of VALID ON are -

Developing new processes and practices

– VALID ON can develop new processes and procedures in Printing Services industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for VALID ON to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for VALID ON to hire the very best people irrespective of their geographical location.

Low interest rates

– Even though inflation is raising its head in most developed economies, VALID ON can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.

Building a culture of innovation

– managers at VALID ON can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Printing Services industry.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, VALID ON can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help VALID ON to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Identify volunteer opportunities

– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. VALID ON can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Creating value in data economy

– The success of analytics program of VALID ON has opened avenues for new revenue streams for the organization in Printing Services industry. This can help VALID ON to build a more holistic ecosystem for VALID ON products in the Printing Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Better consumer reach

– The expansion of the 5G network will help VALID ON to increase its market reach. VALID ON will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.

Learning at scale

– Online learning technologies has now opened space for VALID ON to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.

Manufacturing automation

– VALID ON can use the latest technology developments to improve its manufacturing and designing process in Printing Services sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, VALID ON can use these opportunities to build new business models that can help the communities that VALID ON operates in. Secondly it can use opportunities from government spending in Printing Services sector.

Reconfiguring business model

– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help VALID ON to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.

Use of Bitcoin and other crypto currencies for transactions in Printing Services industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for VALID ON in the Printing Services industry. Now VALID ON can target international markets with far fewer capital restrictions requirements than the existing system.

---

Threats VALID ON External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of VALID ON are -

Instability in the European markets

– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. VALID ON will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.

Technology disruption because of hacks, piracy etc

– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.

High dependence on third party suppliers

– VALID ON high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.

Easy access to finance

– Easy access to finance in Printing Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. VALID ON can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of VALID ON.

Consumer confidence and its impact on VALID ON demand

– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Printing Services industry and other sectors.

Technology acceleration in Forth Industrial Revolution

– VALID ON has witnessed rapid integration of technology during Covid-19 in the Printing Services industry. As one of the leading players in the industry, VALID ON needs to keep up with the evolution of technology in the Printing Services sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.

Increasing wage structure of VALID ON

– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of VALID ON.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, VALID ON can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate VALID ON prominent markets.

New competition

– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for VALID ON in the Printing Services sector and impact the bottomline of the organization.

Aging population

– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.

Regulatory challenges

– VALID ON needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Printing Services industry regulations.

Stagnating economy with rate increase

– VALID ON can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Printing Services industry.

---

Weighted SWOT Analysis of VALID ON Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at VALID ON needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants. We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –

First stage for doing weighted SWOT analysis of VALID ON is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.

Second stage for conducting weighted SWOT analysis of VALID ON is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.

Third stage of constructing weighted SWOT analysis of VALID ON to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that VALID ON needs to make to build a sustainable competitive advantage.

--- ---